Posts made in July, 2015

Emerging Technology Risks

Posted by on Jul 31, 2015 in News | 0 comments

Driverless cars, wearables, and drones are among a few of the emerging technologies that pose unforeseen risk exposures for businesses. Here are seven emerging technology risks presented in an infographic by our partner company...

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Directors and Officers Insurance Coverage

Posted by on Jul 23, 2015 in News | 0 comments

On average, there are 1,285 claims made per year against directors and officers. It is not uncommon for this type of claim to end up costing millions of dollars.  The average overall cost of D&O claims in 2014 was over $51 million. These claims are not limited to large, publicly-owned organizations. Businesses and organizations of any size have risk. This includes privately-held firms, for-profit businesses, non-profit organizations, and educational institutions. Watch this short video via our partner Chubb Insurance as a top executive learns that D&O liability insurance – and not his company’s GL policy – will help protect him against certain types of lawsuits. So what is Directors and Officers Insurance? D&O insurance is designed to protect board members, directors, officers, and managers from allegations of wrongdoing brought against them in regards to their role in the governance of the organization. It is liability insurance that provides personal financial protection for company officers and directors as individuals. What Exactly Does D&O Cover? It covers claims that arise against directors and officers from actions they have made that have resulted in negative financial consequences for the organization, including: Actual or alleged wrongful acts Decisions Omissions For listed stock companies D&O insurance can also cover claims that arise from a wrongful act in connection with the trading of its securities. Defense costs and financial losses that result from claims against directors and officers are also covered under a D&O policy. Within the limit of liability, some D&O policies include defense expenses. What does this mean? The cost of defense expenses will be taken out of the total amount of insurance available to pay the claim. Now, some types of claims don’t involve a significant defense expense, while other types of claims have the potential of using most, if not all, of the liability limits. If the company has paid the claim of a third party on behalf of its managers, in some cases the policy will cover the insured company. Most of the time, these policies are written to cover claims on a “claims-made basis,” which means claims that are made while the policy is in effect. In some cases, a policy will have an extended reporting period where claims can be reported after the policy has expired. Called a retroactive period, generally, a D&O policy will also cover claims for wrongful acts that took place before the policy’s inception. Let’s Take a Look at What is Not Included Under D&O Coverage Where the Claim Arises from the Following: Breach of contract Bodily injury Acting for personal profit Property damage Fraud Dishonest acts Pollution Intentional acts of noncompliance Claims made under a previous policy Claims covered by other insurance Keep in mind that corporate by-laws and/or indemnification agreements do not provide complete protection against D&O risk. Who is Protected by D&O Insurance? Directors Officers Managers Committee members Employees Sometimes volunteers who are acting under the direction of the organization. What Type of Exposures do Directors and Officers Face?  Securities litigation Allegations of misrepresentation Regulatory actions HR issues Employment practices Reporting errors Shareholder actions Failure to comply with regulations or laws Inaccurate or inadequate disclosure Making decisions that exceed the authority granted to the officer Other breaches of fiduciary duties Employee Piracy is another area of growing risk to directors and officers. How does this occur? When a key employee has left the company to either join a competing organization or start their own company. Because of this breach, the previous employer could end up suing the firm the past employee has joined as well as the directors and officers of that...

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Five Tips to Shop for Commercial Insurance

Posted by on Jul 17, 2015 in News | 0 comments

A type of insurance called commercial insurance is a plan designed uniquely for your particular business. There are four main categories of coverage when it comes to commercial insurance, these include: property insurance, general liability insurance, commercial automobile insurance and umbrella insurance. You should know these five tips before you start shopping for commercial insurance for your business: Shop, Shop, Shop and Evaluate Value When it comes to finding the best choice for your commercial coverage, evaluating policy prices is an essential element as long as your decision is based on value and you’re not just focusing on the price. Educate and do Your Homework A one-size-fits-all policy will not magically solve your commercial needs because your coverage requirements depend on a number of variables. Do you own your own property? Do you have customers who come to your work site? How many employees do you have? Do you have vehicles to cover? How many vehicles are over the road? What is the total number of autos you use? What are these vehicles used for? What kind of inventory do you have to carry? Is there any special equipment you have to maintain? Understanding the type of coverage needed will help keep costs down on the policy you choose. It is important to only purchase coverage that best fits your business and industry. Conduct a Risk Management Audit Before you begin shopping or working with an insurance agent, is there something you can do now to lower your current risk? This could help save you money on your premium because the insurer will take note of your efforts of managing risk within your business. Clean Up Your Credit It’s a fact; those with the highest credit score prove to be a lower risk therefore rewarding them with the lowest premiums so pay your bills on time and monitor your total debt load. Beware of Over Insuring If you don’t need it, don’t buy it! How much insurance your purchase depends on the area of risk that you’re seeking to mitigate and sometimes insurance isn’t the best solution. It’s always best to consult with a risk advisor to determine the most valuable and cost-effective solution with the best coverage to protect your...

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So You had a Data Breach – Now What?

Posted by on Jul 9, 2015 in News | 0 comments

When larger organizations face a data breach of their customer or employee information, they often offer free credit monitoring services to affected individuals. If you are faced with a personal data compromise and don’t receive this offer, there are still several options to help you recover from a personally identifiable information (PII) breach, say the experts at Wombat Security Technologies. It’s important to be proactive about minimizing the impact of data breach, whether yours is one of many compromised records or you are the victim of a limited-scope breach. With the latter, if you have the motive and the means to enroll in a credit monitoring service on your own dime, it could be well worth the peace of mind to know that someone is looking out for you. Regardless, the following do-it-yourself activities will help you mitigate some of the damage caused by a data breach — as well as prevent future damage. If you’ve been alerted to an account breach — or you suspect you’ve fallen for a phishing email that prompted you to reveal credentials for a login-protected site like webmail, online banking, or social media — change your password posthaste. If you happen to use that same password on other sites, be sure to update those logins as well. Hackers will often cross-check stolen passwords on multiple sites in hopes of getting a hit. For cases in which you personally discover or suspect a data security breach, contact the help lines for affected accounts right away. Be sure to use trusted customer service channels, such as phone numbers from your credit cards or billing statements. In many cases, it’s not just account numbers that hackers and scammers scoop up. They often grab names, email addresses, and phone numbers to use in follow-up attacks. In these attacks, fraudsters will put together multiple pieces of information they have about individuals to make their messages and calls seem more legitimate and more believable. It’s important to be on high alert once you know your data is already in the hands of hackers. With all the ado about cyber security attacks, it can be easy to become complacent about snail mail. But consider the prior point about email addresses and phone numbers and you’ll see that the leap to a mail-based attack isn’t hard to make. If scammers obtain your name, address, and other identifying information, it can be easy for them to send compelling and seemingly genuine letters, bills, payment notices and other mailers. It’s critical that you verify the validity of unsolicited mail that asks for any type of remittance....

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The Damaging Effects of Lightning Strikes for Businesses

Posted by on Jul 2, 2015 in News | 0 comments

Lightning strikes may seem like a rare occurrence, but they can wreak havoc if they strike your property, says Insurance Institute for Business and Home Safety President and CEO Julie Rochman. “People often underestimate the harm that lightning strikes can cause for their business, but make no mistake–it’s a dangerous force to be reckoned with,” says Rochman. “We encourage business owners to take the necessary precautions to protect their property from the damaging effects of a lightning strike, such as power surges.” For protection from lightning strikes in the general area of your office or an externally produced surge, a “whole-house” surge protector is the best starting point for reducing the risk of damage or a fire. Install additional protection for important or expensive electronic equipment. This should include localized surge protection for power cords to the electronic equipment and any telephone and cable/satellite television lines connecting to the equipment. Make sure all equipment is UL-listed and properly labeled. Lightning protection systems are designed to protect a structure and provide a specified path to harness and safely ground the super-charged current of the lightning bolt. The system neither attracts nor repels a strike, but receives the strike and routes it harmlessly into the earth, thus discharging the dangerous electrical event. Be sure the lightning protection system is designed and installed in accordance with accepted industry standards. Stay off landline/wired telephones and utilize a cell phone if necessary. In your office, do not stand near open windows, doorways or metal piping. Stay away from the television, plumbing, sinks, tubs, radiators and stoves. Avoid contact with small electric appliances such as radios, or toasters....

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